MYTHS & MIS-PERCEPTIONS EDUCATIONAL ADVISORY SERIES: Topic #3

THE MYTH: Government approval is not required for the sale or acquisition of a telecommunications carrier or its assets (e.g., customer base).

THE REALITY: Government approval and/or notification is required for transactions involving a telecommunications carrier and certain assets, including customers, at both the state and federal levels.

Government Approval Requirements for Sales/Acquisitions of Telecommunications Companies & Customer Bases

Despite a general awareness that the telecommunications industry is heavily regulated, we have recently witnessed a widespread lack of understanding of both state and federal regulations governing mergers, acquisitions and other transactions among regulated service providers. These burdensome regulations, coupled with a potentially lengthy and time-consuming regulatory approval process oftentimes throw sand in the gears of the otherwise fast-paced, highly-competitive telecommunications marketplace. Failing to take into account the regulatory approval requirements, processes, and timelines when contemplating a transaction involving regulated assets can result in many unexpected and unintended adverse consequences. Such outcomes may not only impact
current business plans and growth initiatives, but future ones as well.

The purpose of this Educational Advisory is to dispel the Myth and Mis-perception that businesses are not required to obtain regulatory approval for the sale and/or acquisition of either a telecommunications carrier or it customer base, and to highlight the potentially onerous regulatory requirements that carriers may face in seeking government approval for their transactions.

Click to read more: Government Approval Requirements for Sales/Acquisitions of Telecommunications Companies & Customer Bases

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